Hajj, Umrah business tumbles
Around 1,238 Hajj and Umrah agencies in Bangladesh have been severely hit by the Covid-19 crisis yet again, causing them to lose around Tk3,000 crore in turnover this season
Hajj and Umrah agencies in Bangladesh have once again suffered a collapse in business as this Umrah season is almost over. No pilgrims could visit Saudi Arabia as yet due to the spike in Covid-19 infections.
The Hajj Agencies Association of Bangladesh (HAAB) also expressed concerns about whether it will be able to send Hajj pilgrims to Saudi Arabia this year, noting that the pandemic had severely impacted this sector in 2020.
The Saudi Arabian authorities suspended Umrah until further notice on 26 February last year to contain the spread of the novel coronavirus. The move has hit around 1,238 Hajj and Umrah agencies in Bangladesh, causing them to lose around Tk3,000 crore in turnover this season.
Keep updated, follow The Business Standard's Google news channel
The losses caused by the suspension of the Umrah pilgrimage only stood at Tk1,175 crore in the previous season as the agencies were able to send a segment of devotees before the ban, data from the HAAB have shown.
Although Umrah can be performed all the year round, most Umrah pilgrims from Bangladesh go to Saudi Arabia during the November-April period, the association added.
Proprietor Mahmodul Hoque Pearu of Hoque International Tours and Travels, a Chittagong-based agency providing Hajj and Umrah pilgrimage services since 1999, told The Business Standard, "My agency deals with 500-800 Umrah pilgrims each season, but due to the Covid-19 pandemic, we could not send a single person this season till April 2021.
"I have lost business worth at least Tk6 crore this year due to the suspension of the Umrah pilgrimage. We were able to send only 150 people till December 2019, which was the last Umrah season."
Umrah packages vary from Tk90,000 to Tk2 lakh. A package that includes accommodation in a three-star category hotel is around Tk1.20 lakh.
Hajj pilgrimage caught in uncertainty
Umrah is an Islamic pilgrimage to Mecca – the holiest city for Muslims located in Saudi Arabia – that can be undertaken at any time of the year, while Hajj is observed on specific dates according to the Islamic lunar calendar.
Moreover, Hajj is a week-long Islamic ritual and a must for financially capable Muslims at least once in their lifetime.
Each year, around 200-400 pilgrims go to perform Hajj through Hoque International Tours and Travels. However, the agency was not able to send its 170 aspiring hajjis to the Kingdom of Saudi Arabia last year due to the pandemic.
Around 137,198 Bangladeshis were set to perform Hajj in 2020.
The kingdom hosted Hajj in late July last year. Only 10,000 Muslim residents of Saudi Arabia itself were allowed to participate in it, a far cry from the 2.5 million Muslims from around the world who participated in 2019, according to international media.
However, it is unclear how many pilgrims will be allowed for Hajj this year.
We completely lost all Umrah-related business in the current season and Hajj-related business in the last one year. There is also little to no possibility for Hajj-related business to resume this year. This crisis is threatening our very existence
"We completely lost all Umrah-related business in the current season and Hajj-related business in the last one year. There is also little to no possibility for Hajj-related business to resume this year. This crisis is threatening our very existence," Pearu pointed out.
He added, "All Hajj and Umrah agencies operate as travel agents too. But the sale of tickets has dropped below the bare minimum due to travel and flight restrictions on various international routes."
Hoque International Tours and Travels used to have 11 staff members, but now has six. Pearu had to let five of his employees go as he was struggling to pay them in time and manage the maintenance cost of his business for the last one year.
Almost 43% of Umrah pilgrims visit Saudi Arabia during the Islamic months of Rajab, Shaban and Ramadan, making it the busiest season after Hajj for agencies economically dependent on religious tourism, reports TRT World – a Turkish state-owned news media outlet.
Meanwhile, HAAB sources said around 2.5 lakh people from Bangladesh visit Saudi Arabia to perform Umrah each year through private management.
In a relaxation of Covid-19 curbs last October, Saudi Arabia opened the Grand Mosque for prayers for the first time in seven months and partially resumed Umrah, which usually attracts millions of Muslims from across the globe each year.
However, on 5 April this year, the Saudi Ministry of Hajj and Umrah said only people immunised against Covid-19 will be allowed to perform the year-round Umrah pilgrimage, starting from the holy month of Ramadan, reports the Qatar-based Al Jazeera news network.
It is also not clear whether the policy, which comes amid an uptick in coronavirus infections in Saudi Arabia, will be extended to the annual Hajj pilgrimage later this year.
Even though the lion's share of Saudi Arabia's wealth comes from oil, pilgrims visiting Mecca and Medina are critical to its economy.
The kingdom saw more than 19 million pilgrims for Umrah and 2.5 million pilgrims for Hajj in 2019. Together they contributed approximately $12 billion or 7% of total GDP and 20% of the kingdom's non-oil GDP, reports the TRT World.
Agencies can get back 50% deposit money
As the Hajj and Umrah agencies are suffering from an unprecedented crisis, the Ministry of Religious Affairs recently allowed them to take back 50% of their security deposits for one year to help them bear maintenance costs.
"Around 50% of the agencies took out their security deposit money to survive this crisis, which is Tk10 lakh each. Many agency owners are also engaging in alternative businesses," said HAAB President M Shahadat Hossain Taslim.
The association currently has 1,238 members, while the number of its officers and employees – including the owners of Hajj agencies – is around 20,000. Around 1 lakh people in Bangladesh and Saudi Arabia are also involved in the sector indirectly.
The transactions and net loss related to Hajj and Umrah were Tk6,175 crore in 2020
He continued, "Last year, we took preparations to privately send 1.20 lakh Hajj pilgrims to Saudi Arabia. But we faced a loss of around Tk5,000 crore when we failed to send the pilgrims. Besides, the agencies each had to pay monthly salaries to staff and office rents last year.
"The transactions and net loss related to Hajj and Umrah were Tk6,175 crore in 2020."
Adding that 100% Umrah services and most part of Hajj services operate through private agencies, Taslim said, "HAAB members are experienced in serving the pilgrims. So, it is crucial to help these agencies so that they can survive this crisis."
Taslim said although there has been no declaration on sending Hajj pilgrims from Bangladesh this year, he remains optimistic about the situation. He, however, mentioned that the agencies did not get any government incentives even after pressing home their demand last year.
